I am fully aware of how auroras as a phenomenon occurs, thanks to my high school physics class.
Let's pretend that all that is not real - the sunspots, solar activity, electromagnetism, and all those crazy complicated things we managed to absorb in physics. Yes, we are capable of understanding all those things, but let's put them aside for now and use your irrational imagination for once. Ready?
What if someone is just hiding behind the icy mountain top with a huge projector that is so powerful that only a handful of people know about - kind of like James Bond type secret gadgets and weapons that civilians have no idea about. This machine generate a beautiful ray of light that appears to dance and the light captivates any spectators that bothered to look up and spot these mysterious glow in the night sky.
Wouldn't this be a great scheme to have to enhance tourism in a land where weather is not the main attraction, nor it is a shopping destination? What it does have is a beautiful landscape, but it needs a little edge since many other countries also have this feature. It brings people and money in, tourists are satisfied and intrigued by these things they named the northern lights...it's a win win, isn't it? Hi-tech Pocahontas stuff!